A statement said Telebras plans to set up a joint venture company with Spain's IslaLink Submarine Cables and investment funds to build and operate a Brazil-Europe cable at a cost of $185 million.

It said 55 percent of the joint venture will be under Brazilian control—with a 35 percent stake for Telebras and 20 percent for investment funds—while IslaLink will have a 45 percent stake.

Work on the project is expected to start in the second half of this year and the cable is expected to enter into service 18 months later, Telebras chief Francisco Ziober Filho told reporters.

Currently there are five undersea fiber optic cables linking Brazil with the outside world, four of them to the United States and only one to Europe.

A Telebras spokesman said the new cable will provide greater security for Brazilian telecommnications following reports that US and British electronic spy agencies have been tapping undersea fiber optic telecom cables that link Asia, the Middle East and Europe.

In November, Telebras signed a $560 million contract to deliver a satellite for secure communications, following months of outrage over revelations of US cyber-spying.

It said a joint venture between Telebras and Embraer would deliver the geostationary satellite for strategic communications by late 2016.

The satellite is to ensure Brazil's "sovereignty over strategic communications in both the civilian and military areas," Telebras then said.

Brasilia reacted angrily last year to reports of US electronic spying on Brazilian government communications, as well as phone call data and emails of millions of Brazilians.

Those disclosures, drawn from disclosures from fugitive US intelligence leaker Edward Snowden, led Brazilian President Dilma Rousseff to slam the United States at the UN General Assembly session in September and to scrap a planned state visit to Washington.

Meanwhile, Telebras on Wednesday also announced a partnership with Angola to build an undersea fiber optic telecom cable link between the two Portuguese-speaking allies.

"Our participation in this project of Angola Cable is to serve as a relay for a cable they (the Angolans) are building to reach the United States via Brazil. The relay point will be in (the northeastern city) of Fortaleza," said Telebras ex-president Caio Bonilha.

Telebras also said it has signed a memorandum of understanding with Chilean and Argentine firms to build a fiber optics network connecting Brazil, Chile and Argentina.

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